Notice2025-17339
Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Options 7, Section 3
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
September 10, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 173 (Wednesday, September 10, 2025)</title>
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[Federal Register Volume 90, Number 173 (Wednesday, September 10, 2025)]
[Notices]
[Pages 43716-43722]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-17339]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-103888; File No. SR-BX-2025-016]
Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Amend Options 7,
Section 3
September 5, 2025.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\, and Rule 19b-4 thereunder,\2\ notice is hereby given
that on August 26, 2025, Nasdaq BX, Inc. (``BX'' or ``Exchange'') filed
with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I, II, and III, below, which
Items have been prepared by the Exchange. The Commission is publishing
this notice to solicit comments on the proposed rule change from
interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend its Specialized Quote Feed \3\ or
``SQF'' Port and SQF Purge Port \4\ pricing at Options 7, Section 3, BX
Options Market--Ports and other Services.
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\3\ ``Specialized Quote Feed'' or ``SQF'' is an interface that
allows Market Makers to connect, send, and receive messages related
to quotes, Immediate-or-Cancel Orders, and auction responses into
and from the Exchange. Features include the following: (1) options
symbol directory messages (e.g., underlying instruments); (2) system
event messages (e.g., start of trading hours messages and start of
opening); (3) trading action messages (e.g., halts and resumes); (4)
execution messages; (5) quote messages; (6) Immediate-or-Cancel
Order messages; (7) risk protection triggers and purge
notifications; (8) opening imbalance messages; (9) auction
notifications; and (10) auction responses. The SQF Purge Interface
only receives and notifies of purge requests from the Market Maker.
Market Makers may only enter interest into SQF in their assigned
options series. Immediate-or-Cancel Orders entered into SQF are not
subject to the Order Price Protection, Market Order Spread
Protection, or Size Limitation Protection in Options 3, Section
15(a)(1), (a)(2), and (b)(2) respectively. See Options 3, Section
7(e)(1)(B).
\4\ The SQF Purge Interface only receives and notifies of purge
requests from the Market Maker.
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While the changes proposed herein are effective upon filing, the
Exchange has designated the amendments become operative on January 1,
2026.
The text of the proposed rule change is available on the Exchange's
website at <a href="https://listingcenter.nasdaq.com/rulebook/bx/rulefilings">https://listingcenter.nasdaq.com/rulebook/bx/rulefilings</a>, at
the principal office of the Exchange, and at the Commission's Public
Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend Options 7, Section 3, BX Options
Market--Ports and other Services. Specifically, BX proposes to amend
its current SQF Port Fee of $550 per port, per month, and its SQF Purge
Port fee of $540 per port, per month.
BX proposes to amend the SQF Port Fee and the SQF Purge Port Fee as
follows: The first 5 ports (1-5) would be assessed $1,620 per port, per
month; the next 15 ports (6-20) would be assessed $1,080 per port, per
month; and all ports over 20 ports (21 and above) would be assessed
$540 per port, per month. The Nasdaq Options Market LLC (``NOM'') has
identical SQF Port fees and identical SQF Purge Port fees.\5\
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\5\ See NOM Options 7, Section 3(i).
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Only Market Makers \6\ utilize SQF Ports and SQF Purge Ports for
quoting purposes. A BX Market Maker requires only one SQF Port to
submit quotes in its assigned options series into BX. While a Market
Maker may elect to obtain multiple SQF Ports and SQF Purge Ports to
organize its business,\7\ only one SQF Port and SQF Purge Port is
necessary for a Market Maker to fulfill its regulatory quoting
obligations.\8\
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\6\ A:Market Maker'' means a Streaming Quote Trader or a Remote
Streaming Quote Trader who enters quotations for his own account
electronically into the System. See Options 1, Section 1(a)(28).
\7\ For example, a Market Maker may desire to utilize multiple
SQF Ports for accounting purposes, to measure performance, for
regulatory reasons or other determinations that are specific to that
Member.
\8\ BX Market Makers have various regulatory requirements as
provided for in Options 2, Section 4. Additionally, BX Market Makers
have certain quoting requirements with respect to their assigned
options series as provided in Options 2, Section 5. SQF Ports are
the only quoting protocol available on BX and only Market Makers may
utilize SQF Ports. The same is true for SQF Purge Ports.
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[[Page 43717]]
2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\9\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\10\ in particular, in that it is designed to
promote just and equitable principles of trade, to remove impediments
to and perfect the mechanism of a free and open market and a national
market system, and, in general to protect investors and the public
interest. Additionally, the Exchange believes that its proposal
furthers the objectives of Sections 6(b)(4) and 6(b)(5) of the Act,\11\
in particular, in that it provides for the equitable allocation of
reasonable dues, fees, and other charges among members and issuers and
other persons using any facility, and is not designed to permit unfair
discrimination between customers, issuers, brokers, or dealers.
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\9\ 15 U.S.C. 78f(b).
\10\ 15 U.S.C. 78f(b)(5).
\11\ See 15 U.S.C. 78f(b)(4) and (5).
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Proposed Port Fees Are Reasonable, Equitable and Not Unfairly
Discriminatory
The Exchange believes that its proposal furthers the objectives of
Sections 6(b)(4) and 6(b)(5) of the Act,\12\ in particular, in that it
provides for the equitable allocation of reasonable dues, fees, and
other charges among members and issuers and other persons using any
facility, and is not designed to permit unfair discrimination between
customers, issuers, brokers, or dealers. This belief is based on
comparability, the proposed fees are comparable to, and in some cases
less than, those of similarly situated exchanges.
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\12\ See 15 U.S.C. 78f(b)(4) and (5).
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The proposed fees for BX SQF Ports and BX SQF Purge Ports are
identical to NOM SQF Ports and NOM SQF Purge Ports fees.\13\ NOM has
identical SQF Port and SQF Purge Port protocols.\14\ Additionally, the
proposed fees for BX SQF Ports and BX SQF Purge Ports are comparable to
those of its closest competitors, MIAX Pearl, LLC (``Pearl''); \15\
MIAX Emerald, LLC (``Emerald''); \16\ Cboe BZX Exchange, Inc.
(``BATS''); \17\ Cboe C2 Exchange, Inc. (``C2''); \18\ MIAX Sapphire,
LLC (``Sapphire'') \19\ based on market share.
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\13\ See NOM Options 7, Section 3(i).
\14\ See Options 3, Section 7(e)(1)(B).
\15\ Pearl assesses Market Makers $5,000.00 for up to 10 classes
and up to 20% of classes by volume; 7,5000 for up to 40 classes and
up to 35% of classes by volume; 10,000.00 for up to 100 classes and
up to 50% of classes by volume; 12,000.00 for over 100 classes and
up to 50% of classes by volume up to all classes listed on Pearl.
For the calculation of the monthly Full Service MEO Port fees Market
Makers, the applicable fee rate is the lesser of either the per
class basis or percentage of total national average daily volume
measurement. The amount of monthly Full Service MEO Port (Bulk) fee
is based upon the number of classes in which the Market Maker was
registered to quote on any given day within the calendar month, or
upon the class volume percentages. A Market Maker is determined to
be registered in a class if that Market Maker has been registered in
one or more series in that class. The Exchange will assess Pearl
Market Makers the monthly Full Service MEO Port--Bulk fee based on
the greatest number of classes listed on Pearl that the Pearl Market
Maker registered to quote in on any given day within a calendar
month. The class volume percentage is based on the total national
average daily volume in classes listed on Pearl in the prior
calendar quarter. Newly listed option classes are excluded from the
calculation of the monthly Full Service MEO Port--Bulk fee until the
calendar quarter following their listing, at which time the newly
listed option classes will be included in both the per class count
and the percentage of total national average daily volume. MEO Purge
Ports are not capable of sending or receiving any other type of
messages or information. A MEO Purge Port is assessed $600 per
matching engine. Each Limited Service MEO Port fee entitles a Pearl
member to one (1) such port for each matching engine. Pearl has
multiple match engines. See Pearl's Fee Schedule.
\16\ Emerald Express Interface or ``MEI'' is a connection to
Emerald systems that enables Market Makers to submit simple and
complex electronic quotes to Emerald. Emerald assesses monthly MEI
Port Fees based on the number of options classes and the percentage
of national average daily volume. The applicable fee rate is the
lesser of either the per class basis or percentage of total national
average daily volume measurement as follows: (1) $5,000.00 for up to
5 classes and up to 10% of classes by volume; (2) 10,000.00 for up
to 10 classes and up to 20% of classes by volume; (3) 14,000.00 for
up to 40 classes and up to 35% of classes by volume; (4) 17,500.00
for up to 100 classes and up to 50% of classes by volume; and (5)
20,500.00 for over 100 classes and over 50% of classes by volume up
to all classes listed on Emerald. For these Monthly Emerald MEI Port
tier levels, if the Market Maker's total monthly executed volume
during the relevant month is less than 0.025% of the total monthly
executed volume reported by OCC in the customer account type for
Emerald-listed option classes for that month, then the fee will be
$14,500.00 instead of the fee otherwise applicable to such level.
Purge Ports provide Market Makers with the ability to send quote
purge messages to the Emerald System. Purge Ports are not capable of
sending or receiving any other type of messages or information.
Further, an Emerald Market Maker may request and be allocated two
(2) Purge Ports per matching engine to which it connects via a Full
Service MEI Port and will be charged the below monthly fee per
matching engine. Purge Ports are $600 per matching engine. Emerald
has multiple match engines. See Emerald's Fee Schedule.
\17\ BATS Ports with bulk quoting capability provide users with
the ability to submit and update multiple quote bids and offers in
one message through logical ports enabled for bulk-quoting. Ports
with bulk quoting capabilities are assessed $1,500 per month for the
1st and 2nd port and $2,500 per month for the 3rd port or more.
Purge Ports are $750 per port, per month. See BATS Fee Schedule.
\18\ C2 assesses $1,500 per port for Bulk BOE Ports 1-5 and
$2,500 per port and Bulk BOE Ports >5. Each Bulk BOE Logical Port
will incur the logical port fee indicated in the table above when
used to enter up to 30,000,000 orders per trading day per logical
port as measured on average in a single month. Each incremental
usage of up to 30,000,000 orders per day per BOE Bulk Logical Port
will incur an additional logical port fee of $2,500 per month.
Incremental usage will be determined on a monthly basis based on the
average orders per day entered in a single month across all of a
market participant's subscribed BOE Bulk Logical Ports. Bulk BOE
Ports Discount: A Market-Maker will receive a 30% discount on its
monthly Bulk BOE Logical Port fees, excluding incremental usage
fees, where the Market-Maker (1) has a Step-Up ADAV equal to or
greater than 0.03% of OCV from September 2022 and (2) has a ``Make
Rate'' equal to or greater than 97%. A Market-Maker will receive a
40% discount on its monthly Bulk BOE Logical Port fees, excluding
incremental usage fees, where the Market-Maker (1) has a Step-Up
ADAV equal to or greater than 0.05% of OCV from September 2022 and
(2) has a ``Make Rate'' equal to or greater than 97%. The ``Make
Rate'' shall be derived from a Market-Makers volume the previous
month in all symbols using the following formula: (i) the Market-
Maker's total simple add volume divided by (ii) the Market-Maker's
total simple volume. Trades on the open and complex orders will be
excluded from the Make Rate calculation. The Exchange will aggregate
the trading activity of separate Market-Maker firms for purposes of
the discount tier and make rate calculation if there is at least 75%
common ownership between the firms as reflected on each firm's Form
BD, Schedule A. C2 assesses a Purge Port fee of $850 per port. See
C2's fee schedule.
\19\ Sapphire assesses a Full Service MEO Port Fee of $2,500 for
up to 10 classes and up to 20% of Classes by volume, $3,750 for up
to 40 classes and up to 35% of Classes by volume, $5,000 for up to
1000 classes and up to 50% of Classes by volume, and $6,000 for over
100 classes and over 50% of Classes by volume up to all Classes
listed on Sapphire. For this Monthly MIAX Sapphire Full Service MEO
Port tier level, if the Market Maker's total monthly executed volume
during the relevant month is less than 0.015% of the total monthly
executed volume reported by OCC in the Market Maker account type for
MIAX Sapphire-listed option classes for that month, then the fee
will be $4,000 instead of the fee otherwise applicable to such
level. For the calculation of the monthly Full Service MEO Port fees
to be assessed to Market Makers, the applicable fee rate is the
lesser of either the per class basis or percentage of total national
average daily volume measurement. The amount of the monthly Full
Service MEO Port fee will be based upon the number of classes in
which the Market Maker was registered to quote on any given day
within the calendar month, or upon the class volume percentages. A
Market Maker is determined to be registered in a class if that
Market Maker has been registered in one or more series in that
class. The Exchange will assess Sapphire Market Makers the monthly
Full Service MEO Port fee based on the greatest number of classes
listed on Sapphire that the Sapphire Market Maker registered to
quote in on any given day within a calendar month. The class volume
percentage is based on the total national average daily volume in
classes listed on Sapphire in the prior calendar quarter. Newly
listed option classes are excluded from the calculation of the
monthly Full Service MEO Port fee until the calendar quarter
following their listing, at which time the newly listed option
classes will be included in both the per class count and the
percentage of total national average daily volume. MIAX Sapphire
will assess monthly MEO Port fees to Market Makers in each month the
Market Maker has been credentialed to use the MEO Port in the
production environment and has registered to quote in at least one
class. MEO Port users will be allocated two (2) Full Service MEO
Ports per Matching Engine to which they connect. Sapphire assesses a
purge ports of $600 per Matching Engine. Sapphire has multiple match
engines. See Sapphire's Fee Schedule.
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[[Page 43718]]
Below is a chart comparing BX's proposed SQF Port and SQF Purge
Port fees to those of NOM, an affiliated Nasdaq options exchange that
has identical SQF Ports and SQF Purge Ports.
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Market
Exchange share (%) SQF port SQF purge port
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BX....................................... 1.8 per port, per month as per port, per month as
follows: follows:
[ssquf] First 5 ports (1-5): [ssquf] First 5 ports (1-5):
$1,620. $1,620.
[ssquf] Next 15 ports (6- [ssquf] Next 15 ports (6-
20): $1,080. 20): $1,080.
[ssquf] All ports over 20 [ssquf] All ports over 20
ports (21 and above): $540. ports (21 and above): $540.
NOM...................................... 4.8 per port, per month as per port, per month as
follows: follows:
[ssquf] First 5 ports (1-5): [ssquf] First 5 ports (1-5):
$1,620. $1,620.
[ssquf] Next 15 ports (6- [ssquf] Next 15 ports (6-
20): $1,080. 20): $1,080.
[ssquf] All ports over 20 [ssquf] All ports over 20
ports (21 and above): $540. ports (21 and above): $540.
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The below chart compares BX proposed fees to the fees of various
unaffiliated options exchanges with comparable logical ports.
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Market
Exchange share (%) Quoting port Quoting purge port
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BX....................................... 1.8 per port, per month as per port, per month as
follows: follows:
[ssquf] First 5 ports (1-5): [ssquf] First 5 ports (1-5):
$1,620. $1,620.
[ssquf] Next 15 ports (6- [ssquf] Next 15 ports (6-
20): $1,080. 20): $1,080.
[ssquf] All ports over 20 [ssquf] All ports over 20
ports (21 and above): $540. ports (21 and above): $540.
Pearl.................................... 2.9 $5,000.00 for up to 10 MEO Purge Port assessed $600
classes and up to 20% of per matching engine. Each
classes by volume; 7,5000 Limited Service MEO Port
for up to 40 classes and up fee entitles a Pearl member
to 35% of classes by to one (1) such port for
volume; 10,000.00 for up to each matching engine. For
100 classes and up to 50% example, the purchase of 4
of classes by volume; Limited Service MEO Ports
12,000.00 for over 100 will allow the Pearl member
classes and up to 50% of to access 4 ports per
classes by volume up to all matching engine.
classes listed on Pearl.
Emerald.................................. 4.1 the lesser of either the per $600 per matching engine.
class basis or percentage
of total national average
daily volume measurement as
follows: (1) $5,000.00 for
up to 5 classes and up to
10% of classes by volume;
(2) 10,000.00 for up to 10
classes and up to 20% of
classes by volume; (3)
14,000.00 for up to 40
classes and up to 35% of
classes by volume; (4)
17,500.00 for up to 100
classes and up to 50% of
classes by volume; and (5)
20,500.00 for over 100
classes and over 50% of
classes by volume up to all
classes listed on Emerald.
For these Monthly Emerald
MEI Port tier levels, if
the Market Maker's total
monthly executed volume
during the relevant month
is less than 0.025% of the
total monthly executed
volume reported by OCC in
the customer account type
for Emerald-listed option
classes for that month,
then the fee will be
$14,500.00 instead of the
fee otherwise applicable to
such level.
BATS..................................... 4.1 $1,500 per month for the 1st $750/port/month.
and 2nd port and $2,500 per
month for the 3rd port or
more.
[[Page 43719]]
C2....................................... 2.8 Bulk BOE Ports 1-5 is $1,500 $850 per port.
per port and Bulk BOE Ports
>5 is $2,500 per port
Market-Maker will receive a
30% discount on its monthly
Bulk BOE Logical Port fees,
excluding incremental usage
fees, where the Market-
Maker (1) has a Step-Up
ADAV equal to or greater
than 0.03% of OCV from
September 2022 and (2) has
a ``Make Rate'' equal to or
greater than 97%. A Market-
Maker will receive a 40%
discount on its monthly
Bulk BOE Logical Port fees,
excluding incremental usage
fees, where the Market-
Maker (1) has a Step-Up
ADAV equal to or greater
than 0.05% of OCV from
September 2022 and (2) has
a ``Make Rate'' equal to or
greater than 97%. The
``Make Rate'' shall be
derived from a Market-
Makers volume the previous
month in all symbols using
the following formula: (i)
the Market-Maker's total
simple add volume divided
by (ii) the Market-Maker's
total simple volume. Trades
on the open and complex
orders will be excluded
from the Make Rate
calculation.
Sapphire................................. 2.2 Full Service MEO Port Fee of $600 per Matching Engine.
$2,500 for up to 10 classes
and up to 20% of Classes by
volume, $3,750 for up to 40
classes and up to 35% of
Classes by volume, $5,000
for up to 1000 classes and
up to 50% of Classes by
volume, and $6,000 for over
100 classes and over 50% of
Classes by volume up to all
Classes listed on Sapphire.
If the Market Maker's total
monthly executed volume
during the relevant month
is less than 0.015% of the
total monthly executed
volume reported by OCC in
the Market Maker account
type for MIAX Sapphire-
listed option classes for
that month, then the fee
will be $4,000 instead of
the fee otherwise
applicable to such level.
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The Exchange's analysis utilized the below graph representing the
market share \20\ for each of the eighteen options markets based on
total options contracts traded from August 1, 2024 through August 1,
2025.
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\20\ Market share is the percentage of volume on a particular
exchange relative to the total volume across all exchanges, and
indicates the amount of order flow directed to that exchange. High
levels of market share enhance the value of trading and ports. Total
contracts include both multi-list options and proprietary options
products. Proprietary options products are products with
intellectual property rights that are not multi-listed. BX does not
list proprietary products.
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[[Page 43720]]
[GRAPHIC] [TIFF OMITTED] TN10SE25.002
NOM
NOM has a market share of 4.8% which is comparable to BX's market
share of 1.8%. The BX SQF Port and SQF Purge Port fees are identical to
the NOM SQF Port and SQF Purge Port fees in NOM Options 7, Section
3(i), namely an SQF Port Fee of $1,620 for the first 5 ports (1-5),
$1,080 for the next 15 ports (6-20): $540 for all ports over 20 ports
(21 and above). These same fees apply to NOM SQF Purge Ports.
Pearl
Pearl has a market share of 2.9% which is comparable to BX's market
share of 1.8%. Pearl assesses Market Makers $5,000.00 for up to 10
classes and up to 20% of classes by volume; 7,5000 for up to 40 classes
and up to 35% of classes by volume; 10,000.00 for up to 100 classes and
up to 50% of classes by volume; 12,000.00 for over 100 classes and up
to 50% of classes by volume up to all classes listed on Pearl. For the
calculation of the monthly Full Service MEO Port \21\ fees Market
Makers, the applicable fee rate is the lesser of either the per class
basis or percentage of total national average daily volume measurement.
Monthly Full Service MEO Port (Bulk) fee is based upon the number of
classes in which the Market Maker was registered to quote on any given
day within the calendar month, or upon the class volume percentages set
forth in the above table. A Market Maker is determined to be registered
in a class if that Market Maker has been registered in one or more
series in that class. The Exchange will assess Pearl Market Makers the
monthly Full Service MEO Port--Bulk fee based on the greatest number of
classes listed on Pearl that the Pearl Market Maker registered to quote
in on any given day within a calendar month. The class volume
percentage is based on the total national average daily volume in
classes listed on Pearl in the prior calendar quarter. Newly listed
option classes are excluded from the calculation of the monthly Full
Service MEO Port--Bulk fee until the calendar quarter following their
listing, at which time the newly listed option classes will be included
in both the per class count and the percentage of total national
average daily volume. ``MEO Purge Ports'' provide Pearl members with
the ability to send quote purge messages to the MIAX Pearl System. MEO
Purge Ports are not capable of sending or receiving any other type of
messages or information. A MEO Purge Port is assessed $600 per matching
engine. Each Limited Service MEO Port fee entitles a Pearl member to
one (1) such port for each matching engine. Pearl's MEO Port fee is
higher than the proposed BX SQF Port Fee. Pearl's MEO Purge Port fee is
lower than BX's proposed SQF Purge Port for up to 20 ports and higher
than BX's proposed SQF Purge Port for 21 or more ports.
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\21\ See <a href="https://www.miaxglobal.com/sites/default/files/page-files/MIAX_Express_Orders_MEO_v2.0a.pdf">https://www.miaxglobal.com/sites/default/files/page-files/MIAX_Express_Orders_MEO_v2.0a.pdf</a>.
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Emerald
Emerald has a market share of 4.1% which is comparable to BX's
market share of 1.8%. MIAX Express Interface or ``MEI'' is a connection
to Emerald systems that enables Market Makers to submit simple and
complex electronic quotes to Emerald.\22\ Emerald assesses monthly MEI
Port Fees based on the number of options classes and the percentage of
national average daily volume. The applicable fee rate is the lesser of
either the per class basis or percentage of total national average
daily volume measurement as follows: (1) $5,000.00 for up to 5 classes
and up to 10% of classes by volume; (2) 10,000.00 for up to 10 classes
and up to
[[Page 43721]]
20% of classes by volume; (3) 14,000.00 for up to 40 classes and up to
35% of classes by volume; (4) 17,500.00 for up to 100 classes and up to
50% of classes by volume; and (5) 20,500.00 for over 100 classes and
over 50% of classes by volume up to all classes listed on Emerald. For
these Monthly Emerald MEI Port tier levels, if the Market Maker's total
monthly executed volume during the relevant month is less than 0.025%
of the total monthly executed volume reported by OCC in the customer
account type for Emerald-listed option classes for that month, then the
fee will be $14,500.00 instead of the fee otherwise applicable to such
level. Purge Ports are not capable of sending or receiving any other
type of messages or information. Further, an Emerald Market Maker may
request and be allocated two (2) Purge Ports per matching engine to
which it connects via a Full Service MEI Port and will be charged the
below monthly fee per Matching Engine. Purge Ports are $600 per
matching engine. Emerald's MEI Port fees are higher than BX's SQF Port
fees. Emerald's Purge Port fee is lower than BX's proposed SQF Purge
Port for up to 20 ports and higher than BX's proposed SQF Purge Port
for 21 or more ports.
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\22\ See <a href="https://www.miaxglobal.com/markets/us-options/miax-options/interface-specifications">https://www.miaxglobal.com/markets/us-options/miax-options/interface-specifications</a>.
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BATS
BATS has market share of 4.1% which is comparable to BX's market
share of 1.8%. BATS ports with bulk quoting \23\ capability provide
users with the ability to submit and update multiple quote bids and
offers in one message through logical ports enabled for bulk-quoting.
Ports with bulk quoting capabilities are assessed $1,500 per month for
the 1st and 2nd port and $2,500 per month for the 3rd port or more.
Purge Ports are $750 per port, per month. BATS' ports with bulk quoting
capability are higher than the proposed BX SQF Port Fee. BATS' purge
ports are lower than the proposed BX SQF Purge Port.
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\23\ See <a href="https://cdn.cboe.com/resources/membership/US_Options_BOE_Specification.pdf">https://cdn.cboe.com/resources/membership/US_Options_BOE_Specification.pdf</a>.
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C2
C2 has market share of 2.8% which is comparable to BX's market
share of 1.8%. C2 assesses $1,500 per port for Bulk BOE \24\ Ports 1-5
and $2,500 per port and Bulk BOE Ports >5. Each Bulk BOE Logical Port
will incur the logical port fee indicated in the table above when used
to enter up to 30,000,000 orders per trading day per logical port as
measured on average in a single month. Each incremental usage of up to
30,000,000 orders per day per BOE Bulk Logical Port will incur an
additional logical port fee of $2,500 per month. Incremental usage will
be determined on a monthly basis based on the average orders per day
entered in a single month across all of a market participant's
subscribed BOE Bulk Logical Ports. Bulk BOE Ports Discount: A Market-
Maker will receive a 30% discount on its monthly Bulk BOE Logical Port
fees, excluding incremental usage fees, where the Market-Maker (1) has
a Step-Up ADAV equal to or greater than 0.03% of OCV from September
2022 and (2) has a ``Make Rate'' equal to or greater than 97%. A
Market-Maker will receive a 40% discount on its monthly Bulk BOE
Logical Port fees, excluding incremental usage fees, where the Market-
Maker (1) has a Step-Up ADAV equal to or greater than 0.05% of OCV from
September 2022 and (2) has a ``Make Rate'' equal to or greater than
97%. The ``Make Rate'' shall be derived from a Market-Makers volume the
previous month in all symbols using the following formula: (i) the
Market-Maker's total simple add volume divided by (ii) the Market-
Maker's total simple volume. Trades on the open and complex orders will
be excluded from the Make Rate calculation. The Exchange will aggregate
the trading activity of separate Market-Maker firms for purposes of the
discount tier and make rate calculation if there is at least 75% common
ownership between the firms as reflected on each firm's Form BD,
Schedule A. C2 assesses a Purge Port fee of $850 per port. C2's Bulk
BOE Logical Port fees are lower for the first 5 ports than BX's SQF
Port fee, however for over 5 ports, C2's Bulk BOE Logical Ports fees
are higher. C2's Purge Port fee is lower for the first 5 ports and
higher for more than 5 ports as compared to BX's SQF Purge Port fee.
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\24\ See <a href="https://cdn.cboe.com/resources/membership/US_Options_BOE_Specification.pdf">https://cdn.cboe.com/resources/membership/US_Options_BOE_Specification.pdf</a>.
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Sapphire
Sapphire has market share of 2.2% which is comparable to BX's
market share of 1.8%. Sapphire assesses a Full Service MEO Port \25\
Fee of $2,500 for up to 10 classes and up to 20% of Classes by volume,
$3,750 for up to 40 classes and up to 35% of Classes by volume, $5,000
for up to 1000 classes and up to 50% of Classes by volume, and $6,000
for over 100 classes and over 50% of Classes by volume up to all
Classes listed on Sapphire. For this Monthly MIAX Sapphire Full Service
MEO Port tier level, if the Market Maker's total monthly executed
volume during the relevant month is less than 0.015% of the total
monthly executed volume reported by OCC in the Market Maker account
type for MIAX Sapphire-listed option classes for that month, then the
fee will be $4,000 instead of the fee otherwise applicable to such
level. For the calculation of the monthly Full Service MEO Port fees to
be assessed to Market Makers, the applicable fee rate is the lesser of
either the per class basis or percentage of total national average
daily volume measurement. The amount of the monthly Full Service MEO
Port fee will be based upon the number of classes in which the Market
Maker was registered to quote on any given day within the calendar
month, or upon the class volume percentages. A Market Maker is
determined to be registered in a class if that Market Maker has been
registered in one or more series in that class. The Exchange will
assess Sapphire Market Makers the monthly Full Service MEO Port fee
based on the greatest number of classes listed on Sapphire that the
Sapphire Market Maker registered to quote in on any given day within a
calendar month. The class volume percentage is based on the total
national average daily volume in classes listed on Sapphire in the
prior calendar quarter. Newly listed option classes are excluded from
the calculation of the monthly Full Service MEO Port fee until the
calendar quarter following their listing, at which time the newly
listed option classes will be included in both the per class count and
the percentage of total national average daily volume. MIAX Sapphire
will assess monthly MEO Port fees to Market Makers in each month the
Market Maker has been credentialed to use the MEO Port in the
production environment and has registered to quote in at least one
class. MEO Port users will be allocated two (2) Full Service MEO Ports
per Matching Engine to which they connect. Sapphire assesses a purge
ports of $600 per Matching Engine. Sapphire's MEO Port fees are higher
than BX's SQF Port fees. Sapphire's Purge Port fee is lower than BX's
proposed SQF Purge Port for up to 20 ports and higher than BX's
proposed SQF Purge Port for 21 or more ports.
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\25\ See <a href="https://www.miaxglobal.com/markets/us-options/sapphire-options/interface-specifications">https://www.miaxglobal.com/markets/us-options/sapphire-options/interface-specifications</a>.
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In summary, the proposed SQF Port fee is (i) identical to NOM; (ii)
lower than Pearl's, Emerald's, Sapphire's fees, and BATS fees for
greater than 1 port; and C2's fees for over 5 ports (iii) higher BATS
fees for the first port and C2's fees for 1-5 ports. In summary, the
proposed SQF Purge Port fee is (i) identical to NOM; (ii) higher than
Pearl's MEO Purge Port fee for up to 20 ports, higher than Emerald's
Purge Port fee for up to
[[Page 43722]]
20 ports, higher than BATS' purge ports, higher for C2's Purge Port fee
for the first 5 ports, higher than Sapphire's Purge Port for up to 20
ports; and (iii) lower than Pearl's MEO Purge Port fee for 21 or more
ports, lower than Emerald's Purge Port fee for 21 or more ports, lower
than C2's Purge Port fee for more than 5 ports, and lower than
Sapphire's Purge Port for 21 or more ports.
The Proposal is equitable as the proposed fees would apply to all
BX Market Makers in a uniform manner. The proposed BX SQF Port fees and
SQF Purge Port fees would be assessed uniformly to each BX Market
Maker. The Proposal is not unfairly discriminatory. BX SQF Port fees
and SQF Purge Port fees are available to all Market Makers on a non-
discriminatory basis. Unlike other market participants, Market Makers
are required to provide continuous two-sided quotes on a daily
basis,\26\ and are subject to various obligations associated with
providing liquidity.\27\
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\26\ See BX Options 2, Section 5.
\27\ See BX Options 2, Section 4.
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act.
Nothing in the proposal burdens inter-market competition (the
competition among self-regulatory organizations) because approval of
the Proposal does not impose any burden on the ability of other options
exchanges to compete. BX SQF Port fees and SQF Purge Port fees are
comparable to, higher than, and in some cases less than, those of other
exchanges, as discussed above.
Nothing in the Proposal burdens intra-market competition (the
competition among consumers of exchange data) because BX SQF Port fees
and SQF Purge Port fees is available to all Market Makers. Unlike other
market participants, Market Makers are required to provide continuous
two-sided quotes on a daily basis,\28\ and are subject to various
obligations associated with providing liquidity.\29\
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\28\ See BX Options 2, Section 5.
\29\ See BX Options 2, Section 4.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act.\30\
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\30\ 15 U.S.C. 78s(b)(3)(A)(ii).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is: (i)
necessary or appropriate in the public interest; (ii) for the
protection of investors; or (iii) otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#0371766f662e606c6e6e666d7770437066602d646c75"><span class="__cf_email__" data-cfemail="3a484f565f17595557575f544e497a495f59145d554c">[email protected]</span></a>. Please include
file number SR-BX-2025-016 on the subject line.
Paper Comments
<bullet> Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-BX-2025-016. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). Copies of the filing will be available for inspection and
copying at the principal office of the Exchange. Do not include
personal identifiable information in submissions; you should submit
only information that you wish to make available publicly. We may
redact in part or withhold entirely from publication submitted material
that is obscene or subject to copyright protection. All submissions
should refer to file number SR-BX-2025-016 and should be submitted on
or before October 1, 2025.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\31\
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\31\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-17339 Filed 9-9-25; 8:45 am]
BILLING CODE 8011-01-P
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